Australia's Population

[badger41]

Nice to see this thread get back to superannuation, where it started.

IMHO I think Super is one of the biggest con-jobs ever foisted on the Australian people. There seems to be a mantra "put more in to Super", even if you are old, grey and retired. For heaven's sake, why? For minimal tax benefits, but to ensure that once it's in that incredibly complex and controlled system, the Government now controls your money. At Government's whim, it can change the tax situation, the withdrawal regulations etc.

And don't forget the big trap, the 15% tax on capital if you die without a dependent (and, no, adult kids don't count). Not to mention the management/accounting fees, be it in a retail or SM Fund

As a practical example, take our situation (self and wife). Retired from full time work 18 years ago, from part-time 13 years ago. At that point had around $750K plus a house. Since then have travelled overseas and interstate on many occasions (2 trips to Europe), updated our cars (currently 2004 Mazda 3, 2007 Suzuki SX4). Did the seachange thing, so new and better house for maybe $50K to make the move. But as we get older, our desire for travel, and our overall expenses seem to decrease, so we spend a lot less. Certainly our health costs have increased, but as we are now entitled to a small asset-tested part-age-pension, we get all the health benefits that go with a pensioner card. Just wish the family dog (who's now a "dog senior") got the same benefits - so far $700 a year in vet bills on average.

Anyway, we still find ourselves with $750K plus a house. I think the gain in value of the house would offset any decline in the purchasing power of the $75K, which got close to $1m before the GFC. Investments roughly 65% equities, 35% cash/fixed deposits.

As for the age pension being reduced or scrapped that's a lot of voters to upset. But it wouldn't surprise me to see the asset test reduced from its current level of $920K or so.

By the way, I pulled out every dollar I had in Super a couple of years back, for reasons given above. Absolutely no regrets. The current ability for over 60's to withdraw tax free is a "window of opportunity" that I didn't intend to miss.

Cheers, badger

 

[Mr J]

If most know, why bother?

I'm questioning your figure, not that inflation is higher than the official figure.

 

[gooner]

Any superannuation increase will inevitably come from employees take home pay as it has done in the past. Employers will simply reduce pay rises in lieu of extra amounts going to super. This makes absolute sense. It also increases the national savings rate, assuming people do not spend extra outside to compensate. Downside is for lower income earners who lose money they could do with now.

All of my calculations were on a real basis and therefore ignored inflation. Some research has indicated pensioners have a higher inflation rate as they buy less imported goods which have gone down in price (TV's, kitchen goods, iphones, cars - all the stuff we import), but this is still at the margins. Reality is that 9% super for an average earner gives a large lump sum after 40 years.

As for super, I was on the top tax rate for about 14 years. I put as much as I could put into super because I faced a tax rate of 15% instead of 50%. If I took my salary as cash I got $50 net from $100 gross. As super I got $85 net. An immediate 70% return. For some legislative risk and not being able to access until I turn 59, I consider it a bargain. Got a nice nest egg now. In retrospect, best investment decision I made.

 

[beaul]

I have never read so much crap from you guys.

You obviously all live in big cities and never go out and see the "real" world of Australia.
Australia is not like SE Asia. (fertile with lots of rain)
Most of Australia is dry desert or so infertile it cant even support a goanna.
I have been and worked there.

We only gave the aboriginals the land we didn't have any use for. (until we found minerals on it)


In the earlier history of Australia my family (German) arrived in 1920 they were SENT to Queensland. The Italians later on, were SENT to North Qld (sugar cane) they weren't asked.
Our government at the time made policies that were in the best interests of Australia.
If you wanted to migrate to Australia you had to play by our rules.

All that has changed, now the do gooders want to save the world.

Why don't our more recent migrants, lebanese, afganistanis, pakistanis, indians and sri lankans move into the outback.?
Its no worse than where most of them they came from.(By the way, I have been to those countries.)


The fact is, if we were to do that, they would not come here.

Why because most of Australia is barren and worthless until a cyclone comes along every 10 years and drops a lot of rain.

Australia is NOT a big country it probably has less arable/productive land than England or France.

I do think we need a referendum on this matter where the people have a say.

I have never heard a serious debate in recent Australian politics on this matter and it is about time we had one.

I just don't agree that we "need " more people in Australia, and in particular people who should have fixed up their own country before coming here and trying to change ours.

We don't need cheap labour, we can never compete with China.
I also agree that our superannuation is the biggest "con" on Australia after Bob Hawke.

 

[Trembling Hand]

I have never read so much crap from you guys.

You obviously all live in big cities and never go out and see the "real" world of Australia.

Yep nice post. well argued.

 

[Happy]

I have never read so much crap from you guys.
...

I don't disagree with any part of your post except this bit.

People live in different parts of Australia and big cities account for 90% or even more of total population.
About 60% to 90% of all new arrivals be it plane, boat (sorry mods), or university or TAFE end up in big cities too.

Pumping another 14 million to over stretched services will bring if not cracks to our society if not major disturbances, might bring riots.

I don't think for a minute that Cronulla stuff of Macquarie Fields or Redfern are never to be repeated.

Would hate to be close to the next one or one after that.

 

[bellenuit]

Why don't our more recent migrants, lebanese, afganistanis, pakistanis, indians and sri lankans move into the outback.?
Its no worse than where most of them they came from.(By the way, I have been to those countries.)


The fact is, if we were to do that, they would not come here.

The problem is that if it is forced on the new migrants, you create two classes of citizens. Those who can freely live in the cities and those who can't. I assume the largest portion of recent migrants still come from the UK, Ireland, Europe and S.E. Asia. Are you suggesting that they should have more rights than migrants from the countries you named?

Now while I agree that there may be benefits to dictating where new migrants can live and work, I am sure that we have signed some international treaty or other that prevents this. We could also end being accused of creating apartheid, even if those with less rights are far better off than before they migrated.

The best solution is to make it more attractive for new migrants, in fact for anybody, to live in those areas we want to populate. Instead of building infrastructure that encourages the growth of the southern coastal cities, spend that money building infrastructure in the northern coastal population centres.

 

[Julia]

This transition from the working age people supporting the non-working age people to a self sufficient older age life is not going to be an easy one.
Since "living" became mainly dependent on the coloured paper, it is indeed possible for people to provide for their own living via the compulsory superannuation scheme. It is indeed possible but the grey area is 'what lifestyle'.

This subject does in some way come back to "sleeping in the bed one makes". I strongly suggest that stuffing the pillows with feathers in addition to the compulsory scheme is a prudent act to ensure the bed is not a strip of five ply with foam mattress.

Agree entirely. Nice analogy, Wysiwyg.

Nice to see this thread get back to superannuation, where it started.

IMHO I think Super is one of the biggest con-jobs ever foisted on the Australian people. There seems to be a mantra "put more in to Super", even if you are old, grey and retired. For heaven's sake, why? For minimal tax benefits, but to ensure that once it's in that incredibly complex and controlled system, the Government now controls your money. At Government's whim, it can change the tax situation, the withdrawal regulations etc.

And don't forget the big trap, the 15% tax on capital if you die without a dependent (and, no, adult kids don't count). Not to mention the management/accounting fees, be it in a retail or SM Fund

As a practical example, take our situation (self and wife). Retired from full time work 18 years ago, from part-time 13 years ago. At that point had around $750K plus a house. Since then have travelled overseas and interstate on many occasions (2 trips to Europe), updated our cars (currently 2004 Mazda 3, 2007 Suzuki SX4). Did the seachange thing, so new and better house for maybe $50K to make the move. But as we get older, our desire for travel, and our overall expenses seem to decrease, so we spend a lot less. Certainly our health costs have increased, but as we are now entitled to a small asset-tested part-age-pension, we get all the health benefits that go with a pensioner card. Just wish the family dog (who's now a "dog senior") got the same benefits - so far $700 a year in vet bills on average.

Anyway, we still find ourselves with $750K plus a house. I think the gain in value of the house would offset any decline in the purchasing power of the $75K, which got close to $1m before the GFC. Investments roughly 65% equities, 35% cash/fixed deposits.

As for the age pension being reduced or scrapped that's a lot of voters to upset. But it wouldn't surprise me to see the asset test reduced from its current level of $920K or so.

By the way, I pulled out every dollar I had in Super a couple of years back, for reasons given above. Absolutely no regrets. The current ability for over 60's to withdraw tax free is a "window of opportunity" that I didn't intend to miss.

Cheers, badger

But if you've pulled your funds out of Super, aren't you now paying tax on the earnings plus capital gains, whereas if you'd left them in Super and were in pension phase which obviously you are, you'd not be paying any tax?

If you have a SMSF you have control over how, where and when the funds are invested. This, imo, is its huge advantage over using public Super managed funds which on the whole produce very mediocre results.

I have never read so much crap from you guys.

It's so good to have an input from someone with such clearly honed perception and excellent command of the language.

 

[So_Cynical]

We need a inland state, a state with no coast line, a state where a new city can grow and suck in 2 or 3 million people....sure there's not a lot to inland Australia but the main reason there's nothing there is that there is no inland state...no capital to provide white collar careers and services, no critical mass.

 

[Wysiwyg]

We need a inland state, a state with no coast line, a state where a new city can grow and suck in 2 or 3 million people....sure there's not a lot to inland Australia but the main reason there's nothing there is that there is no inland state...no capital to provide white collar careers and services, no critical mass.

Could change the A.C.T. to a state and all the criteria are met. :aus:

 

[DocK]

I am reminded of a movie (think it may have been Gallipolli?) where a young guy off to war explains to an old man in central Australia that "if we don't stop them there, they might invade here" and the old guy ascerbically replies "and they're welcome to it". Or something along those lines...

It is indeed a problem that us Aussies love to live near water, and that the vast majority of us are clustered around the edges of our country. I grew up in regional Queensland, and much prefer the Gold Coast Our young people are deserting the little country towns that were once the backbone of Australia to flee to the cities as quickly as they can. Our towns are dying. Our migrants naturally want to live where the majority of us do - for the same reasons as the rest of us.

I think the clever hats need to come up with some very good incentives to entice people away from the cities and back to the towns. To use Mt Isa as an example - there is no reason I can think of to move there apart from the possibility of earning good money (unless you're an ugly woman, according to Mt Isa's mayor). Maybe if there were good tax breaks for living in regional areas, more people would move to those areas to benefit from lower taxes. As Bellenuit has said, if more Govt funds were spent on infrastructure in inland or northern coastal Australia, it would be more attractive to new Aussies to live there.

I dimly recall that in my first job, employees transferred "out west" received a "living away from home" bonus, or some type of bonus for "living more than 5 hours from ocean" - maybe all taxpayers should be offered something similar?

 

[DocK]

Any superannuation increase will inevitably come from employees take home pay as it has done in the past. Employers will simply reduce pay rises in lieu of extra amounts going to super. This makes absolute sense. It also increases the national savings rate, assuming people do not spend extra outside to compensate. Downside is for lower income earners who lose money they could do with now.
All of my calculations were on a real basis and therefore ignored inflation. Some research has indicated pensioners have a higher inflation rate as they buy less imported goods which have gone down in price (TV's, kitchen goods, iphones, cars - all the stuff we import), but this is still at the margins. Reality is that 9% super for an average earner gives a large lump sum after 40 years.

As for super, I was on the top tax rate for about 14 years. I put as much as I could put into super because I faced a tax rate of 15% instead of 50%. If I took my salary as cash I got $50 net from $100 gross. As super I got $85 net. An immediate 70% return. For some legislative risk and not being able to access until I turn 59, I consider it a bargain. Got a nice nest egg now. In retrospect, best investment decision I made.

I can certainly understand your decision to put extra into super Gooner, as on your tax rate it would certainly make sense, but sometimes I think some posters on this forum lose sight of the "Aussie battlers" who are on minimum or average wage and are pushing it uphill just to get by. I look at our employees and know that the last thing they need is less take-home pay. They're on 30c tax rate, late 20's to mid 30's and in the saving for deposit/paying off mortgage/having babies stages of life. They've had 9% of their wages put into super for almost their entire working lives, unlike us older folk. People my age and older are the ones in the most strife, if we haven't looked after ourselves, as we didn't have compulsory super forced on us and may therefore have way too little set aside. I agree with Wsiwyg that some extra "plumping of the pillows" would be a very good idea for those currently having 9% put away, but at least they should be able to "exist" on only the compulsory super accumulated, if that is all they eventually have. If not, I think they should have to work a little longer, if able, to provide for themselves. I don't think having more of their earnings taken away from them now, while they need them, is the best answer - and would no doubt be political suicide for any government that tried to enforce it.

Perhaps compulsory super contributions should be scaled according to age - starting at 5%, increasing to 9% at say, 30 years of age, and increasing again to 12% at 40, 15% at 50 - as people age they will hopefully have the mortgage reduced, the kids educated etc and have more disposable income to contribute to their retirement.

 

[gooner]

....snip...

I dimly recall that in my first job, employees transferred "out west" received a "living away from home" bonus, or some type of bonus for "living more than 5 hours from ocean" - maybe all taxpayers should be offered something similar?

There is an existing remote area tax offset

http://www.ato.gov.au/taxprofessionals/content.asp?doc=/content/rebate_zone.html

 

[DocK]

There is an existing remote area tax offset

http://www.ato.gov.au/taxprofessionals/content.asp?doc=/content/rebate_zone.html

Ah, there you go, shows how little I know. Maybe the zones should be widened and/or the offset increased.

Off to work, will be intrigued to see how you've all solved our problems upon my return

 

[So_Cynical]

There is an existing remote area tax offset

http://www.ato.gov.au/taxprofessionals/content.asp?doc=/content/rebate_zone.html

And its a joke...Ceduna don't qualify for the offset even though its 750+ kilometres to the state capital, (Adelaide) and 360+ kilometres to larger medical, shopping and social centres (Port Lincoln, Port Augusta)

 

[It's Snake Pliskin]

Australia needs 50 million to provide security and opportunity.

 

[Aussiejeff]

Australia needs 50 million to provide security and opportunity.

Why stop there? In case you have underestimated, how about making it 75 million, just to be safe?

Awww, shucks. Make it a neat 100 million. Rounded figures are easier to deal with....

 

[Wysiwyg]

Why stop there? In case you have underestimated, how about making it 75 million, just to be safe?

Awww, shucks. Make it a neat 100 million. Rounded figures are easier to deal with....

I think you may have caught one of these ...

Posts may be factually incorrect, taken out of context, misinterpreted, or left in the fridge for too long

 

[Wysiwyg]

He said greater publicly-funded health, aged care and related expenditures to support generation X and Y in their retirement years will need to come from a relatively smaller number of workers.

http://www.thebull.com.au/articles_detail.php?id=9599

What basis do people make these projections on? Why will a relatively smaller number of workers need to support elderly people? I think people can be looking after themselves financially while not relying on the community to fill the financial gaps. Money to pay for the inevitable assistance we all need at an older age is what is required and there is plenty of people to fill the assistance roles required.
I think these forward lookers aren't looking at what is needed if people are going to be living longer. They need more of their own money.

 

[Happy]

100 million? why stop there make it 1 billion.


No matter how we do it to supposedly support older generation with extra population, one day will be the day that growth cannot be sustained and we will be caught with pants down big time.

What consecutive Governments do is delay the inevitable so this doesn’t happen now.

If you ask me? JUST BIG JOKE.